Guest blogger, T Jeremy Loomis, Sales Manager for Wells Fargo Home Mortgage, talks of tax credit ending questions and concerns.

Is it time to change how buyers view contract issues with the tax credit ending?


We have seen a market recently that one would call a “buyers market”, where the buyer has more control over the purchase of their new home and the seller may have to make more concessions they would in a “seller’s market”. But with the tax credit ending on April 30th, 2010 (remember a qualifying buyer must be in a binding sales contract by 4-30-2010 and settlement on the new home by 6-30-2010) the sellers will gain the upper hand.

So if a buyer is already in a binding sales contract what do they have to worry about? Quite simply, what happens during the process and after April 30th if issues come up with an inspection, the appraisal report, etc…What happens if a buyer has to negotiate repairs, appraisal issues, or the like once Friday’s deadline passes? A buyer who is vying for the tax credit will need to tread lighter after the 30th as a seller could be less likely to negotiate on a certain area and the buyer really has 2 choices at that time — walk away from the contract and the tax credit (remember you may not have that option at all) or work with the seller to come to a reasonable win-win situation to continue with the contract.

Overall, we will see sellers with a better bargaining position then they have had over the past few years. And we must remember that buyers must remain reasonable with all requests when issues arise and think “what if I was on their side”.

The final question a buyer would have to think about: Is the issue at hand worth losing a tax credit up to either $6,500 (for those “move up” buyer) or $8,000 (first time home buyers)?


Thank you, Jeremy!

Contact Jeremy and myself for more information on the tax credit deadline!